US President Donald Trump on Tuesday revealed a new trade agreement with Indonesia that includes a 19% tariff on Indonesian goods entering the United States, part of a broader push by the administration to renegotiate trade deals and slash the US trade deficit. The deal also includes significant commitments from Indonesia to purchase American goods, according to Trump.
“Indonesia will pay the United States a 19% Tariff on all Goods they export to us, while U.S. Exports to Indonesia are to be Tariff and Non Tariff Barrier FREE,” Trump wrote on Truth Social, adding that the US would gain full access to Indonesian markets. He claimed on Truth Social that Indonesia had agreed to purchase $15 billion in US energy products, $4.5 billion in agricultural goods, and 50 Boeing jets—though no timeline for these transactions was provided.
A new trade approach before August 1 deadline
The Indonesia deal mirrors a recent framework agreement with Vietnam and is part of Trump’s strategy to impose higher tariffs unless countries strike bilateral trade deals with the US. The administration has set an August 1 deadline after which most US import tariffs will increase unless agreements are reached.
Trump had earlier warned Indonesia of a possible 32% tariff unless a deal was reached. Similar letters were sent to over two dozen countries, including Canada, Japan, and Brazil, proposing tariffs ranging from 20% to 50%, including a 50% levy on copper.
Indonesia responds
In Jakarta, Susiwijono Moegiarso, a senior official with Indonesia’s Coordinating Ministry for Economic Affairs, confirmed that the two countries are preparing a joint statement detailing the tariff levels and associated trade arrangements. “We will inform [the public] soon,” he told Reuters via text message.
While Indonesia is not a top-15 US trading partner, trade has grown steadily. In 2024, total bilateral trade reached just under $40 billion, with the US. running a goods trade deficit of nearly $18 billion. Indonesia’s top exports to the US include palm oil, footwear, electronics, rubber, tires, and frozen shrimp.
As Trump’s tariff deadline looms, global markets are watching closely. The White House has so far secured limited deals with the UK, Vietnam, a partial tariff truce with China, and now Indonesia—while major trading blocs like the EU brace for an all-out trade war.
